US wants Australia to modify its cheap drugs scheme as part of trade deal

US government negotiators are pressing the Australian government to agree to modifications to the government subsidised pharmaceutical benefits scheme in exchange for allowing Australian farmers better access to US markets, as part of a free trade agreement.

Under the scheme, the Australian government subsidises approved drugs and negotiates heavily discounted prices from the manufacturer. Patients, who pay what is often a nominal “co-payment” on a prescription, are then able to receive them far more cheaply than they otherwise would.

Assistant US trade representative Ralph Ives confirmed at the conclusion of the first week's negotiations in Canberra that the scheme was on the …